- A Practical Guide to Diversity for Startups and Entrepreneurs - October 11, 2020
- 4 Startup Myths That Hold Innovation Back (and How to Overcome Them) - September 28, 2020
Entrepreneurs are rightly focused on building the next billion-dollar business. With so many startup success stories and technological advancements these days, anything is possible. However, as an increasing body of research demonstrates, there is another often forgotten factor that drives startup success: diversity and inclusion.
McKinsey, Bank of America/Merrill Lynch and the Peterson Institute for International Economics all found that having a high percentage of women in a company’s senior leadership results in significantly better financial results. Plus, inclusive organizations are twice as likely to exceed financial targets: 85 percent of CEOs whose companies have an inclusiveness strategy said it’s improved their bottom line.
I’ve worked in tech for over a decade, helping startup companies to create a truly diverse company culture. The following tips are based on my experience consulting with those companies.
So, with the knowledge that diversity is important for startups, where should you begin?
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Here is a practical guide on diversity and inclusion for startups:
- Understand why diversity is important to your startup
The first place to start with diversity and inclusion is the “why.”
Ask yourself why diversity and inclusion are important to your business. How will diversity and inclusion help to grow and scale your business? What is it about diversity and inclusion that will fundamentally help drive all the things you will do?
- Articulate how diversity ties to your mission
Once you have done the work of articulating why diversity is important to your startup, you must work on how it ties to your mission.
This is your opportunity to revisit (or even create from scratch) your startup’s mission statement. Your mission statement defines what your startup does, why it exists and its reason for being. At a minimum, your mission statement should define who your customers are, along with your products and services.
- Set diversity goals tied to monetary compensation
Ninety percent of startup founders will not implement a diversity program. Research shows that while 70 percent of startup founders think diversity is important, only 10 percent will actually follow through and implement a diversity program.Nothing will happen unless you set goals. Goals drive behavior, and monetary goals drive behavior faster.
- Appoint a diversity task force and diverse board of directors
Once you have done the basics (understanding why diversity and inclusion are important to your company, incorporating diversity and inclusion into your mission statement, setting diversity goals tied to monetary outcomes), you must set up a process to constantly monitor, adjust and improve your diversity and inclusion practices.
While you can assign this task to yourself, you don’t want to bog yourself down with more day-to-day work that takes your attention away from growing your business. Instead, consider creating a group within your team, a diversity task force, that will focus on bringing more diversity to your business. Have them focus on the day-to-day workings, and report their actions or findings to you on a weekly basis.
If you are serious about diversity and inclusion in your startup, you must also hire diverse directors and seek diverse advisory board members. Companies with diverse management teams achieve 19 percent higher revenue from innovation. This is about moving from intention to action. This is about moving from cheap talk and lip service and good PR to concrete actions about diversity and inclusion. Diversity starts at the top.
- Get real about how diverse and inclusive your startup is (or is not)
Start by measuring how diverse and inclusive your workforce is today so that you can track progress as you start your diversity and inclusion journey.
How can you measure your progress?
Take notice of the diversity that currently exists within your company, from your team members to the suppliers you work with. Where can this be improved, and how will your business benefit from new perspectives brought to the table through more diversity?
- Be a change agent
As the leader of your business, you must take personal accountability and hold those on your team accountable, too. In other words, you can’t just say “there are not enough diverse candidates out there.”
Instead, you need to act. For example, proactively seek diverse talent by posting on multiple job boards that will reach a wide range of candidates with different (but experienced) backgrounds.
- Proactively diversify your network
This is one of my favorite tips because it is so simple yet so powerful. You must make a conscious decision to diversify your network. You must seek the company of people who are different from you when it comes to gender, race, age, sexual orientation, ability or disability.
Proactively seeking to understand different perspectives will open your mind to different ways of thinking and new ideas, and will help you in your own personal diversity and inclusion journey.
The fact that you read this far shows an interest in driving more diversity and inclusion in your startup. Making a conscious choice is the first step. Remember, the large majority of diversity and inclusion efforts fail to translate intention into actions. You can make a difference—and make sure your efforts are successful—by following these simple steps.